Ukraine’s Diverse Stock Market

Ukraine gained its independence from the Soviet Union on 24 August 1991. It has an approximate population of 46.2 million and has many natural resources such as oil, manganese, timber, titanium, iron ore, salt, magnesium and graphite. Ukraine also exports large quantities of food products, fuel, metals, machinery and equipment, with their products being supplied by a rich industrial sector. Industries, including chemical industries, sugar processing, coal, metals and electric power, play an important role in the economy of Ukraine.

When the Ukraine Stock Market came into existence, it was proposed to have a centralized and unified market. But with the entry of new entities and the need for development the Ukraine Stock Market soon divided into two independent stock exchanges, namely the Ukrainian Stock Exchange (or USE) and the PFTS. The Ukrainian Stock Market is based on bonds of which the biggest contributors to the stock markets are banks, registrars, stockbrokers and trading systems. With the lack of a unified stock market in Ukraine, there is no centralized index in regard to stock either. Therefore, companies on the stock exchange have their own individual indexes. The activity on the stock market in the Ukraine does experience periods of lower trade, which the analysts have contributed to drop of trade in power energy.

The Ukrainian Stock Exchange was established on 29 October 1991 and is a closed joint-stock company. It has five branches and there are approximately 106 broker houses registered with the USE. Its securities market is self-regulative and is seen as the leader in privatization and exchange mechanisms. Of the two stock exchanges, the PFTS is by far the larger. The market capitalization of the PFTS is estimated at approximately $ 20 billion and has an average of 220 companies listed on the exchange. With being established only 11 years ago, it is considered to be a relatively
young exchange and with many successes safely secured, it is predicted that the PFTS will only grow bigger and stronger in the future. Even though the Ukrainian Stock Market has been divided into two stock exchanges, both exchanges contribute positively to the economy of the Ukraine and its stock market in general.

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